Austerity Persists In Global Growth Picture

Featuring Patrick Perret-Green

Patrick Perret-Green spent most of his career as a proprietary bond trader before joining macro analysis group AdMacro and his deep research into the US and China points to persistent weakness Stateside and significantly tighter money in China. Patrick sounds the alarm on delinquencies in sub prime autos and global deflationary pressures, as continued drags on growth, while isolating the areas of relative tranquility for investors in foreign exchange markets. Filmed on May 16, 2017, in London.

Published on
26 May, 2017
Topic
Fiscal Policy, Macro, Monetary policy
Duration
61 minutes
Asset class
Commodities, Bonds/Rates/Credit, Currencies
Rating
30

Comments

  • HA

    Hamed A.

    9 6 2017 20:07

    1       0

    great interview, wish we could get more like this. the recap / summary at the end is a nice touch to wrap up the interviews. keep up the good work!

  • TR

    Thomas R.

    1 6 2017 00:17

    3       0

    Grant and for the guest - one more question/observation with regard to whether the US is technically in a recession now. If GDP is a rounded $18T in the US and we are growing optimistically at 2% then GDP is growing by roughly $360B per year. If the US annual deficit is running $500B, then why couldn't one assert that absent deficit spending the US would have negative GDP growth. The guest was absolutely correct that Reagan took over a 30% Debt to GDP economy and that 30% had actually fallen from 100% post WWII. It wasn't annual Gov't surpluses that reduced the Debt to GDP from 100% to 30% over those 35 years (1945 to 1980) it was that GDP grew faster than the Debt. The prospect of that happening going forward without a dramatic "reset" seems highly unlikely.

  • TR

    Thomas R.

    31 5 2017 23:47

    1       0

    The idea of the Japanese Gov't and the Bank of Japan simply making that accounting entry is something I've been wondering and have commented on before on prior RV interviews. Grant, this question is for you when you came back with "If they do that who will buy Yen" My response would be "For people and institutions buying Yen now, what will have really changed. There is no way that debt gets paid back. It has to be monetized, so I would offer back - So what if that "accounting entry" gets made. The actually backing of the currency will not have changed. In the US, do we really think that the Fed's balance sheet will get back to under $1T or even under $2T. The scary think for me is that if the Bank of Japan has set the bar - look how much further the US and the Fed has to go. I simply can't comprehend a Fed Balance Sheet comparable to the BOJ.

    Thanks to RV. I am so appreciative of this platform and information flow.

  • BM

    Blair M.

    31 5 2017 08:31

    0       0

    Hi, not sure if others have mentioned this, but I am finding the panning side-shots of the interviews distracting due to the opaque objects in the foreground. I understand this is being done to improve the quality of the video, and I like the side panning, but the opaque objects are annoying to me. Perhaps consider limiting this?
    Otherwise, loving the new intro and conclusion by the interviewer.

  • JC

    John C.

    30 5 2017 19:00

    2       0

    I really liked this. Realize it's a bit of a re-hash of a ton of other stuff we've seen but a nice, fresh spin. I say that as someone who doesn't believe in Europe now and thinks more USD strength is on the way so I disagree with his currency outlook (and agree with Raoul's, well eventually). I would note it's funny how he brings up relevant points about the US economy slowdown but vis-a-vis who? Europe? It's a total basketcase with perpetual low-growth, massive social issues, migration, huge youth unemployment, creeping communism and stifling bureaucracy almost everywhere. I think RV should really do a tear-down job on the EU and show just how dysfunctional and often times undemocratic it is, and also how many of the bigger countries are in freefall now by almost any measure.

    • PP

      Patrick P.

      5 6 2017 08:23

      0       0

      Hi John, It was all a question of time so we focussed on the US and China. Moreover, relative growth momentum is in Europe's favour, for now. So not the interesting story.
      But it will be. The deep structural flaws of the system are still there and unless one moves to a federal system, rather than one where countries like Greece are forced into a deflationary depression and treated like a naughty school boy by Germany.
      Also let's not forget Germany defaulted in the 1920s and after WW2 and then had the Marshall Plan.
      Also it was their banks that largely went bust first in 2008 and were bailed out, before the rules changed.

  • TS

    Tyler S.

    30 5 2017 16:39

    1       0

    nice new format

  • RD

    R D.

    30 5 2017 03:48

    0       0

    Agree with previous comment that "there isn't a lot new here", but Patrick is clearly a very astute observer and his commentary brought a lot of weight to themes being followed. I do believe that Grant's summary is a great add.

    Parenthetic to the interview content, I think that the camera effects were distracting (maybe I need to get used to it?) and the echo in the room wasn't ideal. Stylistically, I saw Grant being less interactive than normal and in this case I think that this guest's contribution would have been more engaging with more challenge from him. I know this has been a point of contention in other discussions but I conclude that this hinges on the verbal style of the person being interviewed.

  • RA

    Robert A.

    29 5 2017 22:32

    0       0

    Enjoyed this one very much. Summary form for about 6 different global themes that are in current interplay. A true macro jig saw puzzle player. I think I heard a pretty definitive "Last Call" lads.

  • GB

    Grant B.

    29 5 2017 18:41

    0       1

    Very slow I couldn't sit through this. What's really new here?

  • SS

    Sam S.

    29 5 2017 14:44

    1       0

    Nice summary at the end, great perspective, not much in the opportunity section when money has to go somewhere. Overall great info. Thx.

  • DS

    David S.

    29 5 2017 01:54

    0       0

    Trump's effort in weakening NATO helps Russia whether he is in bed with them or not. Is all the talk about NATO members not paying their fair share a smoke-screen?

    • JC

      John C.

      30 5 2017 18:54

      0       0

      the Trump/Russia connection is completely bogus and a leftist media attempt to just bring Trump down. I say this as no real fan of Trump. NATO sure seems like it's found a new 'mission' with the Russian angle and are grasping at any straw to make them the big bogeyman. In any case, the EU and Europe need to start paying more for their own defense - their actions in the migrant crisis show just how unprepared they really are re border control.

  • VK

    Viresh K.

    28 5 2017 19:45

    1       0

    Good interview, prefer the old music though :P

    • VK

      Viresh K.

      28 5 2017 19:46

      0       0

      And the transparent charts, the white background is slightly distracting from the interview.

  • pd

    peer d.

    28 5 2017 15:33

    3       0

    Too polite re his comments about the evil and dangerous arrogance rampant among Ph'd CBers. The pain they have caused amongst pensioners, savers, and generally people trying to live off their savings and the speculation practiced by the large banks and their prop shop arms, is unconscionable. Year zero for them all.

    • js

      jacob s.

      29 5 2017 02:13

      1       0

      their day is coming

    • JC

      John C.

      30 5 2017 18:55

      0       0

      I hope so - might be sooner than we think.

  • DC

    Dale C.

    28 5 2017 12:48

    2       0

    Love the recap at the end. Great addition.

  • JS

    John S.

    28 5 2017 08:08

    0       0

    Fantastic interview great to see some well thought through original thinking
    One of the best on realvision
    Be interested to get Patrick's view on whether we need growth and what that world would like

  • JM

    James M.

    27 5 2017 18:28

    1       0

    Landslide for the tories doesn't seem a foregone conclusion to me. The Tories and Labor have neglected the youth in the UK for many years and their rightly pissed off. If they come out for Corybn then it may not be enough to beat the Tories but it could result in a very weak majority or even a hung Parliament. Which puts May at the mercy of the tory Euro sceptics and diminishes dramatically the chance of a soft BREXIT, may even encourage the Germans and by proxy Macron Angela's effective puppet to really turn the screw on May and the tory euro skeptics. Add to this a landslide in Scotland for SNP and her problems intensify. Either way I think the Sterling Tanks back to 1.20

    • VK

      Viresh K.

      27 5 2017 21:07

      0       0

      Agree with your first sentence, but disagree with the second bit. Weaker the majority, the softer the Brexit we see.

      All it takes is a few europhone MP's to turn and vote with the other side.

  • PP

    Patrick P.

    27 5 2017 08:58

    4       0

    FRED website
    https://fred.stlouisfed.org

  • DI

    Dabangg I.

    26 5 2017 20:54

    0       0

    what is fred's website that he refers to?

    • IA

      Ibrahim A.

      27 5 2017 08:49

      0       0

      search for Atlanta Fed Blog on google

  • MM

    Michael M.

    26 5 2017 20:47

    8       3

    It's genuinely disconcerting to see people this smart talk about something like incarceration in such fuzzy and frankly ignorant terms. Sorry to be blunt, but seriously, what else are you getting completely wrong if you look at the world like this. (I've worked in criminal justice for years and would counsel you to look at - for instance - the decline in violent crime after Clinton's initiatives and other social factors such as the IQ sweet spot for crime or even just recidivsim rates. Looking at the incarcerated population as just 'potential workers' is ABSURD!

    • MM

      Michael M.

      26 5 2017 20:47

      1       0

      forgot to close my brackets!

    • DS

      David S.

      26 5 2017 22:38

      6       0

      Brackets are not a big deal. My problem with non-violent incarceration is the huge amount of tax payer's dollars to pay for government and private prisons. We have to imprison violent criminals, but let's help the non-violent criminals take care of themselves. Prisons are a major growth industry that we cannot afford. DLS

    • MM

      Michael M.

      28 5 2017 11:51

      4       2

      'Non violent crime' is a fiction. Again, as someone who's worked with this population for years, those who even want to take care of themselves are vanishingly rare. I've met two, maybe, out of thousands.

    • js

      jacob s.

      29 5 2017 02:18

      2       4

      You are a part of the problem. Just a cog in the prison industrial complex. Non violent crime is totally a thing: people getting incarcerated because of drugs. How can you be a part of Real Vision yet be so blind?

    • MM

      Michael M.

      30 5 2017 17:23

      0       2

      I went into it thinking exactly like you. And I didn't work in a prison, I worked in 'rehabilitation'. People that get caught for a 'petty' drug offence *almost certainly*are involved in much worse. Which part of the drug trade is non-violent again? I'm the blind one?

  • EH

    Eric H.

    26 5 2017 18:59

    0       0

    crushed it!

  • TJ

    Terry J.

    26 5 2017 15:32

    0       0

    I must confess I did not think I was going to enjoy this intereview at first ,and thought i'd probably cease listening after ten minutes. Instead I ended up watching it twice. Very instructive to get Patrick's insights.

  • EL

    Elizabeth L.

    26 5 2017 14:12

    13       0

    Grant I like that you did an intro and a wrap-up to the interview. And echo Enrico on appreciating the how to position part. Once again great interview.

  • SS

    Sam S.

    26 5 2017 13:51

    4       3

    Had to stop the video to comment on the fuzzy picture movement I found distracting to this great conversation. It was OK in the first few minutes but this format needs to go. I'll do my best to comment on the positives after I finish watching as long as I don't first have a seizure from the video blur movements.

  • EF

    E F.

    26 5 2017 12:37

    2       0

    Fantastic, could've listened for another hour. Also enjoyed the how do you position for these ideas wrap-up question that I feel has been requested in the past on RV.